Indonesians are no longer visiting the city-state as they used to, and this has dealt a bad blow to Starhill Global REIT.

According to analysts from UOB Kay Hian, while a recovery in Indonesian arrivals is nowhere to be seen, a recovery in Chinese arrivals have softened the blow.

UOB Kay Hian adds that a 19.3% spike in Chinese tourist arrivals ameliorated the continued weakening in arrivals from its Southeast Asian neighbor.

“As overall numbers recovered 7.9% and 6.0% yoy respectively in July and August, this led to an overall dip of 0.6% ytd in tourist arrivals. Indonesians and Chinese visitors made up 17.8% and 14.3% of total tourist figures in 8M15,” UOB Kay Hian said.

Meanwhile, Starhill Global REIT continues to extend its overseas footprint with NPI from Australis jumping from 122% to $8.6m during the quarter.

“Australia now accounts for 16% of total portfolio asset value and 23% of its revenue. The slowdown in Singapore could lead to more foreign acquisitions. We estimate SGREIT’s debt headroom at S$227.6m (40% gearing assumed),” UOB Kay Hian said.

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